Australasian Performing Right Association Ltd v Pashalidis [2000] FCA 1815

FEDERAL COURT OF AUSTRALIA

Australasian Performing Right Association Limited v Pashalidis

[2000] FCA 1815

COSTS – bill of costs – whether costs should be reduced by one-third pursuant to O 62 r 36A(1) of Federal Court Rules – review of taxing officer's decision to reduce costs – applicant obtained injunction and damages for infringement of copyright

Federal Court Rules O 62 r 36A(1)

Fasold v Roberts (unreported, Federal Court of Australia, Sackville J, 11 September 1997) applied LED Builders Pty Ltd v Hope (1994) 53 FCR 10 applied

AUSTRALASIAN PERFORMING RIGHT ASSOCIATION LIMITED (ACN 000 016 099) v STEPHEN PASHALIDIS T/AS BODYWORKS FITNESS CLUBS N 448 OF 1999 MOORE J 15 DECEMBER 2000 SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY N 448 OF 1999

BETWEEN: AUSTRALASIAN PERFORMING RIGHT ASSOCIATION LIMITED (ACN 000 016 099)

APPLICANT

AND: STEPHEN PASHALIDIS T/AS BODYWORKS FITNESS CLUBS

RESPONDENT

JUDGE: MOORE J

DATE OF ORDER: 15 DECEMBER 2000

WHERE MADE: SYDNEY

THE COURT ORDERS THAT: 1. The costs ordered to be paid to the applicant not be reduced under O 62 r 36A(1) of the Federal Court Rules.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY N 448 OF 1999

BETWEEN: AUSTRALASIAN PERFORMING RIGHT ASSOCIATION LIMITED (ACN 000 016 099)

APPLICANT

AND: STEPHEN PASHALIDIS T/AS BODYWORKS FITNESS CLUBS

RESPONDENT

JUDGE: MOORE J

DATE: 15 DECEMBER 2000

PLACE: SYDNEY

REASONS FOR JUDGMENT 1 This is an application by the Australasian Performing Right Association Limited ("APRA") for review, pursuant to O 62 r 11 of the Federal Court Rules ("the Rules"), of a decision of a taxing officer to apply O 62 r 36A(1) of the Rules to a bill of costs. 2 The main proceedings, now concluded, were brought by APRA under the Copyright Act 1968 (Cth). APRA alleged that the respondent had infringed and continued to infringe the copyright in musical and literary works (namely songs and lyrics) of which APRA was either the owner or the agent of the owner, by performing them or authorising their performance in his fitness centres. APRA sought an injunction, damages (or an account of profits), additional damages, and an inquiry as to damages or account of profits. On 14 September 1999, I made orders that the issues of liability and damages be determined separately. I then heard evidence and submissions from APRA on liability, and granted injunctive relief. On 29 June 2000 I heard argument concerning damages and on 2 August 2000, I ordered that the respondent pay APRA the sum of $15,669.22 by way of damages (including additional damages): see [2000] FCA 1032. Costs were also ordered against the respondent, who took no part in the proceedings. 3 The decision of the taxing officer is said to be found in a letter from the taxing officer notifying the parties, under O 62 r 46(3)(b), of the estimate of the approximate total for which, if the bill were to be taxed, the certificate of taxation would be likely to issue. After stating that estimate to be $14,666.67, the officer wrote: "Please note that this estimate includes the reduction applicable pursuant to O 62 r 36A. The reduction was applied to the sum of $22,000 which is the approximate total for which, if the Bill were to be taxed would otherwise be likely to issue." 4 APRA seeks an order that the costs ordered to be paid to it not be reduced by one-third under O 62 r 36A(1). O 62 r 36A(1) provides: "Where a party is awarded judgment for less than $100,000 on a claim (not including a cross-claim) for a money sum or damages any costs ordered to be paid, including disbursements, will be reduced by one-third of the amount otherwise allowable under this Order unless the Court or a Judge otherwise orders." 5 APRA bases its application on two grounds. Firstly, it is said that O 62 r 36A(1) cannot apply, on its face, where relief in addition to a claim for a money sum or damages is sought and granted. Secondly, and alternatively, it is submitted that the Court should exercise its discretion not to apply O 62 r 36A(1) in the circumstances of this case. 6 I am prepared to act on the basis that a "decision" of the type comprehended by O 62 r 11 has been made by the taxing officer, and is subject to review by the Court. The taxing officer's estimate under O 62 r 43(3)(a), in terms, has been reduced under O 62 r 36A(1), and O 62 r 46(3)(c) provides that unless the estimate is objected to in the manner set out in that sub-rule, it is deemed to be the amount for which a certificate of taxation may issue. 7 I turn to the first ground of the application, which is that O 62 r 36A(1) cannot apply, on its face, where relief in addition to a claim for a money sum or damages is sought and granted. In this case, that additional relief was an injunction. The import of this ground is that the taxing officer erred in deciding that O 62 r 36A(1) applied to this case. 8 O 62 r 36A(1) requires a taxing officer to make the specified reduction "[w]here a party is awarded judgment for less than $100,000 on a claim … for a money sum or damages". To make good a contention that O 62 r 36A(1) does not apply to this case, it seems that one would have to adopt either of the following interpretations of this quoted clause. Firstly, the words "and no other relief" (or words to similar effect) are to be implied at the end of the clause. I see no basis for such an implication. Secondly, the phrase "claim … for a money sum or damages" is to be construed as meaning an application, proceeding or action brought in the Court seeking "a money sum or damages" and nothing else. However there is no apparent reason, in my opinion, for reading down the rule in this way. Accordingly, the phrase "claim … for a money sum or damages" can be taken to refer to that part of APRA's application seeking monetary relief. On that claim, APRA was awarded judgment for less than $100,000. Accordingly, the taxing officer made no error in deciding that O 62 r 36A(1) applies to this case. 9 I now consider the second ground, which is that the Court should exercise its discretion not to apply O 62 r 36A(1) in the circumstances of this case. Such a discretion is plainly conferred by the words "unless the Court or a Judge otherwise orders". APRA relies principally on the decisions of LED Builders Pty Ltd v Hope (1994) 53 FCR 10 and Fasold v Roberts (unreported, Sackville J, 11 September 1997). 10 In LED Builders Pty Ltd v Hope, the applicant accepted a sum of $5,000 paid into Court by the respondent in a claim for copyright. Tamberlin J said: "In my opinion r 36A, unless applied with discretion and caution can lead to harsh results. Especially is this so in relation to claims for small monetary amounts in matters such as copyright. If the rule is allowed to apply automatically in all cases where a sum, less than $100,000, is recovered, this can lead to harsh results in situations where there is no other more appropriate court." 11 In Fasold v Roberts, an applicant was awarded judgment in the sum of $2,500 for infringement of copyright. Sackville J said: "… I do not think that the fact that the first applicant recovered only $2,500 should result in a reduction of the costs to which he would otherwise be entitled. If this Court is the appropriate forum for the vindication of copyright claims, the fact that the applicant's claim does not exceed $100,000 should not ordinarily deprive him or her of the benefit of a costs order otherwise available. The first applicant established that his copyright had been infringed and I think it appropriate that he should receive the costs of establishing his claim." 12 In referring to their Honours' comments, I should note two points. Firstly, in neither case was his Honour reviewing a decision of a taxing officer to apply O 62 r 36A(1). Accordingly, I would not read these passages as suggesting that a taxing officer has a discretion not to apply O 62 r 36A(1) according to the criteria stated by their Honours. Implicit in the view I have reached in relation to the first ground of this application is a conclusion that the taxing officer was bound to apply the sub-rule in this case. Secondly, in both cases, their Honours were also faced with applications for an order reducing costs by one-third under O 62 r 36A(2). That sub-rule empowers the Court to make such a reduction if it "is of the opinion that a proceedings … brought in this Court could more suitably have been brought in another court or in a tribunal and so declares". Their Honours refused those applications and observed that the Federal Court, given its expertise in copyright matters, was an appropriate forum in which to bring copyright claims. In this case, as noted above, the respondent has taken no part in the proceedings. Naturally, it has not been put to the Court that these proceedings could more suitably have been brought elsewhere. While the proceedings were, in the result, relatively straightforward, I do not think it necessary, or even appropriate, to consider O 62 r 36A(2) in this case. 13 However, these points aside, their Honours' comments are apt to apply to the present case. In addition, the evidence, which is referred to in my judgment of 2 August 2000, reveals that APRA made numerous attempts to have the respondent procure a licence to perform (or authorise the performance of) the relevant works before commencing these proceedings. There is nothing to suggest that APRA did not then prosecute these proceedings with reasonable diligence in what is an appropriate forum. I propose to order that the costs ordered to be paid to APRA not be reduced under O 62 r 36A(1). I do so with some diffidence because I am reviewing the decision of the taxing officer whose decision was correct. It could be expected that ordinarily an order under O 62 r 36A(1) would be sought at the time the question of costs first arose and not by the procedure presently being utilized by APRA. However there is nothing in O 62, and rules 11 and 36A in particular, that suggests the power conferred by O 62 r 36A(1) cannot be exercised in the course of such a review. Moreover the respondent has not opposed the application. APRA did not seek their costs of this application, and accordingly, I make no order for costs.